The document outlines Emirates airline's objectives, strengths, weaknesses, opportunities, and threats in order to determine the best way to deploy its new fleet. It analyzes two options: targeting premium travelers on major existing routes, or targeting economy/leisure travelers in secondary cities. While the premium option achieves economies of scale, the economy option allows entry into a new customer segment and additional revenue. Analysis shows the economy option has lower operating costs, higher profit margins, and economic advantages even at lower passenger load factors. Therefore, the final strategy is to deploy new flights to secondary cities to enhance Emirates' customer base and benefit existing premium routes.

1. OBJECTIVE-
To continually sustain and
increase profitability with
expansion in fleet capacity
and tapping into new
markets with delivering
added value to the
customers.

2. Threats Opportunities
• Intense Competition by premium segment airlines(Qatar and Etihad) • Increase network to new destinations, Tap US-UK premium underserved market.
• Higher fixed cost by investing in A380 and B-777 .
• Opportunity base of 12Mn tons freight and 160 Mn Passengers with expansion
plans in Dubai (DWC ) especially during Expo 2020.
• Elasticity of Demand in business and leisure customers due to economic
downturn.
• Liberal air access has a multiplier effect on a country's economy. Research can be
shared with Government to get faster approvals.
• Obtaining regulatory approval to countries with restrictive policies.
• Along with route operational study, study to shorten airline paths resulting in less
fuel usage and can contribute to bottom line.
• High investment in route operational studies which may not always be
successful in assessing customer or cargo inflows.
• Effective Route management by allocating new aircraft to existing routes.
• Volatile Fuel price, as fuel is 40% to operating costs. • Strengthen existing market by adding new destination to secondary cities .
• Loyalty programmes to retain customers in economy class with partnership with
local tourism organization.
Weakness Strengths
• High cost of Depreciation of fixed assets. • Cash rich organization with high market recognition
• High competition in US market. • Dubai as main hub and big aircrafts help in achieving economies of scale.
• Does not cater to middle class and budget traveller
• Proactive marketing can place it as excellent VFM to business and cargo
community.
• Intense competition means limited market growth and high cost of
maintaining bench mark standards
• Optimum asset utilization with 80% PLF despite increase in capacity and
competition
• Relying heavily on International Onward Moving Traffic • Premium and elite in flight service build brand loyalty
• 3 types of flight optimize pilot deployment, diverse staff.
• Youngest fleet in industry- ensures high safety and less maintenance expenses
• Route Optimization prevents flight downtime.
TOWS Analysis

3. THE WAY AHEAD: Alternatives to deploy new fleet
# Way1 Way2
Targetted Route Major existing heavy Routes Secondary cities in existing markets
Cities (London, Bribane,Zurich,LA) (Sialkot, Clark, Ahmedabad,Kiev)
Targetted Customer Premium/Business traveller Bagpacker/Economy/Leisure traveller
USP Exclusive and Differentiating Affordable and Unique
Proposed value offerings
Free Value Added Services-(Wi-Fi, On demand
entertainment, Personalised Services)
Freemium Services-(Customized Service offering/exclusive
package for students)
Objective
Achieving economies of scale in operations Additional Revenues entering a new customer segment.
More flights can help achieve better Market Share. Enhanced and loyal customer base
Passenger-Focus
Lesser time in airport "Emirates Experience "at an affordable cost.
More choices with non stop flights Connecting flight through various cities.
Priority Boarding Low base price with chargeable services
Requirement/Expenses
Extremely trained staff to cater customer needs. Research on route feasibility for passenger load factor.
Additional Revenue Source
In flight Sales/Surge Pricing Cargo Load/Mails/Passenger Bags/ Loyalty Progrmmes
New Avenues
China and America- Seek regulatory approvals
Enhanced aircraft utilization and option of JV to keep low
fixed costs.

4. Flight Deployment On Long existing Routes,
increasing the frequency.
Customer Segment based Service Offerings in
Secondary Cities of Existing market
THE WAY AHEAD: Alternatives to deploy new fleet
# Way1 Way2

5. Economic Impact -
0%
5%
10%
15%
20%
25%
30%
35%
40%
Emirates Costs in two cases
Case-I(Premium) Case-II(Economy)
Emirates Cost
Impact(Annual)
Case-I
(Premium)
Case-II
(Economy)
Operating Cost per
ASK(Usc) 0.080 0.060
Operating
expenditure(Mn) 16000 12000
Revenue(Mn) 20200 17143
Passenger Load factor 79.21% 70.00%
Profit Margin 26.25% 42.86%
Factors Affecting the Cost in both the cases
Profit Margin with the most optimistic Passenger
Load Factor and current CASK.

6. Final Strategy-
• Emirates should deploy new
flight in catering new markets
of secondary cities.
• This has a economic
advantage in terms of low
operating costs and higher
profit margins even with Low
PLF.
• Enhanced customer base will
also benefit existing premium
routes.
Emirates Cost Case-I(Premium) Case-II(Economy)
Operating Cost per ASK(Usc) 0.080 0.060
Operating expenditure(Mn) 16000 12000
Revenue(Mn) 20200 17143
Passenger Load factor 79.21% 70.00%
Profit Margin 26.25% 42.86%
Passenger Load factor 65.00% 50.00%
Revenue(Mn) 16576.625 12244.89796
Profit Margin 3.60% 2.04%

7. THANK YOU
Presented By: Siddharth Khandelwal
Pooja Srivastava
Jitesh Nambiar